Income Tax (Earnings and Pensions) Act 2003 section 305

Offshore oil and gas workers: mainland transfers

Section 305 provides an income tax exemption for transport, accommodation and subsistence benefits provided to employees whose permanent workplace is an offshore oil or gas installation.

• Employees with a permanent workplace on an offshore installation pay no income tax on transfer transport (travel by sea or air between the mainland and the installation), related overnight accommodation and subsistence, or local transport between that accommodation and the mainland departure or arrival point.
• The exemption also covers payment or reimbursement of reasonable expenses the employee incurs on such transport, accommodation and subsistence.
• The exemption only applies where the mainland departure or arrival point is one from which transport is generally provided for employees, and only covers transport costs that would not otherwise qualify for a tax deduction under the normal employee expenses rules.
• Related accommodation and subsistence must be provided at reasonable cost and must be necessary because of the timing of the transfer transport — for example, an early morning helicopter departure requiring an overnight stay near the heliport.